Platts proposes launch of daily MPP assessment for Venezuela's Merey 16 crude

S&P Global Platts proposes to launch a daily Market Parity Price (MPP) for Venezuela heavy, sour crude Merey 16, effective March 15.

Platts would calculate this daily value for Merey 16 using the MPP model instead of assessing the grade through its existing Market On Close assessment methodology.

The MPP calculation for Merey 16 would be based on the grade's Gross Product Worth benchmarked to a reference basket of relevant crude grades that are actively traded in the regional spot market. These grades are Canada's Western Canadian Select, Colombia's Vasconia and Castilla, and Ecuador's Oriente and Napo. The five basket grades and Merey 16 would be normalized to reflect delivery to the US Gulf Coast, accounting for freight and regional refining input prices.

The MPP model, which Platts also uses to assess Mexico's Maya as well as illiquid crude grades in West Africa and Asia, would ensure the assessment captures both the inherent refining value of the crude as well as the broader oil market supply-demand fundamentals reflected in the price of the reference basket.

Platts would review the MPP model for Merey 16 annually to ensure it continues to reflect prevailing market conditions and quality of the crude grades.

Please send all feedback, comments or questions to americas_crude@spglobal.com and pricegroup@spglobal.com by Feb. 19. For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing. Platts will consider all comments received and will make comments not marked as confidential available upon request.